Economists predict 2.5 percent economic growth for Wilmington area in 2016
By Terry Lane
Staff Writer
The Wilmington regional economy is forecast to grow at 2.5 percent in 2016, slightly above the projected national average of 2.4 percent, economists said during the 24th Annual Economic Forecast breakfast on Thursday.
Dr. Adam Jones, a regional economist with the University of North Carolina Wilmington Cameron School of Business, told the group at the Wilmington Convention Center that the local economy in 2016 will not experience “a banner year, but it won’t be a bad year, either.”
“The area will grow at a slightly faster rate,” Jones said. “We have more resources available to put to work.”
Jones said the Wilmington region had an unemployment rate of 5.5 percent as of October 2015, just above the national average of 5 percent.
“There’s still a gap between U.S. employment rates and North Carolina,” said Richard Kaglic, a senior regional economist for the Federal Reserve Bank of Richmond’s Charlotte branch.
However, Kaglic added that over the past six months North Carolina’s job growth is outpacing the national average.
“That’s because we’re still playing catchup,” Kaglic said. “North Carolina fell deeper into the great recession.”
One reason is the loss of manufacturing jobs, which comprised 26 percent of North Carolina’s employment in 1990 but only 11 percent in 2014. Taking the place of those manufacturing jobs are leisure and hospitality jobs, Jones said.
Overall, North Carolina is below the national average in educational attainment, which is one reason the state will be more exposed to economic disruptions than other areas of the country, Kaglic said. North Carolina pays lower salaries to teachers than the national average and in neighboring South Carolina. North Carolina’s wages aren’t keeping pace, he said, noting wage growth is at only 85 percent of the national average.
“We’re creating jobs at a faster rate but losing wage growth,” Kaglic said.
But Jones noted there are some signs of improving confidence in the Wilmington economy, including upward pressure on wages and rising home sales. However, Wilmington businesses aren’t reflecting the same confident outlook.
“The uptick in home sales gives me confidence,” he said, noting that it reflects most workers’ optimism in the economy. “Households are confident in the outlook, businesses aren’t.”
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